India’s goal of increasing its non-fossil energy production capacity to 500 GW by 2030 and achieving net-zero emissions by 2070, faces a significant challenge with a gap between the demand for and supply of skilled professionals and a shortage of leadership talent. Amidst unprecedented growth, India’s renewable energy sector faces leadership talent crisis, says executive search firm WalkWater Talent Advisors. Kunal Girap, co-founder and director of WalkWater Talent Advisors said the unprecedented boom in RE with a surge in orders had fueled rapid expansion, however, the talent pool, particularly in leadership, has not kept pace with this growth. The RE industry was competing for talent from the same pool leading to distortion in compensation and failing to hold on to talent, Girap said. This has implications for the sector's future and could come in the way of future execution and delivery of RE. All major conglomerates - Tatas, Mahindra, Aditya Birla and JSW have set up independent RE business units. Solar Energy Corporation of India, NTPC, NHPC and SJVN have collectively issued 53.3 GW of solar, wind, hybrid and round-the-clock projects. The Commercial and Industrial segment, which accounts for 40-50% share of the energy demand, could lead to demand for 80 GW. Under the Green Hydrogen Mission, industrial houses such as Reliance, L&T, Adani, NTPC, GAIL and Thermax have lined up investments. PE investments are driving expansion in RE. All the companies are sourcing talent from the same pool, says WalkWater, which carried out a study covering 65 companies and tracked the movement of 204 CXOs over the past three years. This covers a significant part of the Indian RE sector and focused on the top four roles- chief executive officer, chief operating officer, chief financial officer and chief business development officer. The renewable energy industry has onboarded a high number of CXOs since 2021 with 56% of leadership hires as COOs, followed by CFOs at 47% and CBDOs at 45%. There would be around 1,000 to 1,200 people in this talent pool. They have seen a 2x to 2.5x jump in compensation in the last three to four years for critical roles. According to Girap, the industry was seeking tailor-made talent and competing for a limited pool of experienced leaders, leading to a shortage, which had led to retention costs escalating and higher attrition. This has led to an unbalanced increase in salaries, disrupting the compensation parity at senior leadership levels for many companies. Compensation has in some cases have gone up from Rs 70-75 lakhs to around Rs 1.2 crore to Rs 1.7 crore in a year. Also ReadGlobal LNG markets heading towards supply glut with planned capacity additions, likely to benefit India’s gas offtake, says ICRA The RE industry is over committing and promising to deliver more than it can handle so there is no time to stabilize teams or operations, he points out. So there is high burnout seen in the industry with high action packed work for 18 to 24 months during the project execution period and quite a few not able to handle the pressure, Girap said. Attrition levels have reached 25-30% for the RE industry compared to sub-10% in the non-RE industry. Companies have been struggling to keep up with rising compensation demands with candidates becoming overpriced, he said. The talent shortage is further exacerbated by organisations primarily hiring through reference, limiting the ability to tap a broader talent pool. Talent in niche roles that are important for implementing RE projects such as land acquisition, design engineering, policy and regulatory are becoming critical bottlenecks in the RE. A significant talent shortage in specialized roles such as project management, business development, and regulatory affairs. Scarcity was even higher in the newer areas such as Green Hydrogen forcing the RE industry to seek expertise from allied sectors such as oil and gas, chemicals and fertilisers. A strong preference for talent with prior renewable energy experience is limiting the inflow of fresh ideas and perspectives. Wind energy company, Suzlon, has been among those nurturing talent that has gone into the Indian RE industry. WalkWater expects some talent from overseas, either Indian origin talent or expats, being recruited for leadership roles WalkWater suggests the industry will need to adopt a more inclusive approach to talent acquisition, considering candidates from cross-sector and investing in targeted leadership development programs. To address this challenge, organizations must expand their talent acquisition strategies to include professionals from allied industries and invest in targeted skill-building and leadership initiatives, Girap said.
